EU Climate Chief: Energy Prices Hike Should Boost Transition

September 14, 2021

BRUSSELS — The European Union's climate czar said Tuesday the 27-nation bloc should ensure that the most vulnerable people won't pay the heaviest price of the green transition, and pledged measures guaranteeing equal burden-sharing across society, amid a global surge of energy prices.

"The one thing we cannot afford is for the social side to be opposed to the climate side. I see this threat very clearly now that we have a discussion about the price hike in the energy sector," said Frans Timmermans, the European Commission vice president in charge of climate issues. 

As the global demand for gas has soared, energy prices have surged across Europe at a time when the EU is pushing for a quick phasing-out of coal and the development of sustainable sources of energy. Carbon prices have rocketed in recent months, having an impact on electricity bills. 

"Only about one fifth of the price increase can be attributed to Co2 prices rising. The other is simply a consequence of shortage in the the market," said Timmermans, noting that prices for renewables have kept low and stable. 

Timmermans spoke at the European Parliament in Strasbourg, France, during a debate on proposed legislation aimed at helping the bloc cutting emissions of the gases that cause global warming at least by 55% by 2030.

Timmermans said the price hikes in the energy sector should lead the bloc to accelerate the transition toward renewable energy. He pointed out that if the transition had started sooner, the current situation would not have arisen because countries would be less dependent on fossil fuels and natural gas.

The commission's proposals included in the "Fit for 55 package" presented this summer encompass about a dozen major proposals, ranging from the de-facto phasing out of gasoline and diesel cars by 2035 to new levies on gases from heating buildings.

They involve a revamp of the bloc's emissions trading program, under which companies pay for carbon dioxide they emit, and introduce taxes on shipping and aviation fuels for the first time.

Timmermans said the EU's executive branch proposals, which should be endorsed by EU countries and approved by the Parliament, will give the opportunity to all 27 members to introduce measures protecting their citizens, including reducing VAT taxes, duties on energy or giving direct support to households. 

Some lawmakers voiced concerns about the impact of the plan on energy prices. Anna Zalewska, an MEP from coal-reliant Poland, said citizens will "unfortunately pay for the ambitions of the EU." 

"That's why I think what we need to do is to make sure that they do not end up in energy poverty," she said. 

Green lawmaker Ska Keller said public subsidies for fossil fuels should be ended immediately in an accelerated switch to renewable energies. 

Pascal Canfin, the chair of the Parliament committee on the environment, praised the proposal to put an end to petrol and diesel cars but expressed skepticism at the idea of extending the EU's carbon market to transport and buildings.

"Because we believe that the political cost is extremely high, and the climate impact is very low," he said.

Putting a price on emissions from buildings and transport has raised concerns the measure could trigger social protests across Europe similar to the "yellow vests" movement which started in France in 2018 after an increase in fuel taxes.

World leaders agreed six years ago in Paris to work to keep global temperatures from increasing more than 2 degrees Celsius (3.6 degrees Fahrenheit), and ideally no more than 1.5 degrees C (2.7 F) by the end of the century. Scientists say both goals will be missed by a wide margin unless drastic steps are taken to reduce emissions.

"I believe we can still fix it," Timmermans said. "I believe we can prevent the climate crisis from getting out of hand and out of control."


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